Prelude to a sale

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Eight years ago, the Gazette began sponsoring the Pikes Peak Arts Festival and has faithfully supported it ever since with printed materials and advertisements to promote the event. But recently, the newspaper abruptly pulled out — just weeks before this year's festival kicks off later this month.

The same thing happened to the Colorado Springs Conservatory when the Gazette backed out of that sponsorship.

"I had to explain to sponsors that I wasn't able to fulfill the obligation that I had made to include their logos in print in the Gazette," says executive director Linda Weise.

Those and other affected agencies don't blame the local Gazette folks, though. They say the decision to cancel donated ad space to nonprofits and other community support came from the Gazette's owner, Freedom Communications, based in Irvine, Calif.

Monday, the picture became clearer when Freedom announced its remaining properties — including the Gazette — would merge with a Massachusetts company that's been trying to acquire other newspapers.

No terms were disclosed for the deal, which will close in about a month.

Gazette interim publisher Gene Carr, asked by e-mail and phone to explain the sponsorship pullbacks, has been in McAllen, Texas, where he's publisher of another Freedom paper in the process of being sold. Carr didn't respond.

According to a May 24 e-mail sent by Gazette marketing manager Rudy Vasquez to Stargazers Theatre and Event Center, it looks like the newspaper's charitable giving has dried up.

"Sorry to tell you this but they have put a freeze on sponsorships here for now," Vasquez wrote. "I can't help you promote the free Fridays past June 1. I hope this is temporary but for now I am stuck."

Paper profits

Freedom confirmed it's being acquired by 2100 Trust LLC in a merger with a 2100 Trust subsidiary, which tried unsuccessfully to buy the Boston Globe in 2010, then earlier this year tried and failed to acquire papers in Maine.

Besides the Gazette, the Freedom properties involved in the merger include five California papers, including the Orange County Register, longtime flagship of the company, and digital properties, Freedom said in a release.

"While providing the value that our shareholders have sought, this transaction also ensures Freedom's communities that our newspapers serve will continue to receive the outstanding service that has been our hallmark," Freedom's CEO Mitchell Stern said in the release. "Our employees will be able to continue the community journalism at which they so excel."

Aaron Kushner, 2100 Trust's CEO, said in the release, "We couldn't be more pleased with the opportunity to lead the hard-working and talented employees of Freedom Communications in serving these communities. We believe that newspapers are essential to the fabric of our lives and are excited to own and grow these unique institutions."

The merger caps the demise of Freedom, which had been selling its newspapers across the country at a rapid pace in recent months. The company emerged from bankruptcy in 2010 under the control of hedge-fund managers and still coping with some $300 million in debt. It recently sold newspapers in Texas, North Carolina, Florida, New Mexico, Ohio and Indiana, and in April shed eight television stations, saying in a press release the sale "leaves Freedom essentially debt free."

The Gazette's defaulting on promises to nonprofits stands in sharp contrast to its long history of community participation.

In the mid-1990s, the newspaper combined with Freedom to give $1.25 million toward construction of the World Arena. For 28 years, the Gazette has sponsored the Empty Stocking Fund, which helps 14 local charities through a partnership with El Pomar Foundation; last year, $1,143,744 was raised.

The newspaper provided other community sponsorships as well, including free or reduced-price ad space, printing and cash for nonprofits and other events.

In recognition of all that, the Gazette received the 2009 philanthropy award from the Greater Colorado Springs Chamber of Commerce and the Cultural Office of the Pikes Peak Region's (COPPeR) Business & Arts Awards.

Ironically, the Gazette now has canceled its agreement to print the Chamber's newsletter.

Bad timing

Weise was busy putting final touches on Fiddler on the Roof when, the day before Memorial Day weekend, she got the bad news.

"There was a mandate issued they would not be able to honor any contracts for donated ad space," Weise reports. "It was kind of ironic when you just come out of a meeting with several business partners and board members, who said, 'It's so great to see the Gazette do this. I spend so much money with them.' Less than an hour later I get the message."

The timing was particularly bad because Fiddler opened just two weeks later (June 8). Weise says not being able to get a break on Gazette advertising might have hurt ticket sales, but adds, "I have no ill feelings. There are powers beyond the four walls where they live."

For Marica Hefti, organizer of Pikes Peak Arts Festival, losing the newspaper's sponsorship means the loss of six quarter-page ads and a "nice pullout" special section the week before the festival opens June 30. "It was worth $10,000, what they gave us," she says. "I'm grateful to the Gazette and all the fine people there. They have treated us well."

Based on her discussion with Gazette Charities director Liz Denson, Hefti blames Freedom, saying, "Because corporate made the decision that they are trying to sell, I have a hunch they want to get to a healthy bottom line."

Hefti and others have been told the Gazette's news department will help fill the gap by doing news stories about the events. "That's the right thing to do," she says.

Still hope

Not everyone has given up on the newspaper's generosity. Connie Brachtenbach, executive director of TESSA, says the Gazette won't sponsor TESSA's major fundraiser, Pasta in the Park, on Aug. 11, but she hopes it will buy a table or provide reduced-cost or free ads.

While several wondered if the Gazette pullbacks might signal an imminent sale, that wasn't the pattern in McAllen, Texas, where Freedom is selling The Monitor. That paper made no apparent changes in community support before the sale, says Thelma Garza, who heads the United Way of South Texas in McAllen.

"It did not happen to us, and we have not heard of it happening with any of our partnering agencies," Garza says. "The Monitor has always been extremely supportive of our United Way, not just with money but with volunteers. We've had a really good partnership with our paper, and I hope nothing changes, because we count on it."

The same is true for the Northwest Florida Daily News, another Freedom paper being sold, United Way of Okaloosa/Walton president and CEO Bill Robinson says in an e-mail.

"We are not aware of any 'pullback in giving,'" he says.

A Freedom spokesman said he didn't know whether the new owners would resume the Gazette's philanthropic activity.